Market uncertainty remains high, with overseas copper prices driving domestic prices downward. [Institutional Commentary]

Macro side, the US March ISM Manufacturing Index was 49, below the expected 49.5 and the previous 50.3. This marked the first contraction this year, with the price index surging to a new high since June 2022. Factory orders and employment performance were sluggish, highlighting the impact of the new US government's tariff policy on the economy. Details of the US reciprocal tariffs are expected to be finalized, with the White House announcing that the tariffs will take effect immediately after the April 2 announcement. Several countries have indicated they will take countermeasures. Domestically, China's March Caixin Manufacturing PMI was 51.2, higher than the previous 50.8, reaching a new high since December 2024, indicating continued accelerated expansion in manufacturing production and business activities. Inventory side, LME copper increased by 1,900 mt to 213,275 mt; Comex copper increased by 1,223.8 mt to 88,473.19 mt; SHFE copper warrants decreased by 1,457 mt to 136,003 mt; BC copper warrants remained at 15,017 mt.

The continuous increase in COMEX copper inventories may indicate that previous arbitrage positions are gradually being transferred to delivery warehouses. Domestic copper downstream faces restocking, and with the inverted price spread between domestic and overseas markets, the actual momentum for active short selling is insufficient. Before the US reciprocal tariffs are finalized, market uncertainty is high, with overseas copper prices driving domestic prices downward. After the tariffs are finalized, uncertainty diminishes, and attention will be on whether copper resumes its slow upward trend.

(Source: Everbright Futures)